My thoughts on the priority are: 1 - max company RRSP/pension matching (100% return) 2 - max RESP government grant per child (guaranteed 20% return + investment returns) 3 - pay high interest debt ( >8% return) 4 - FHSA (if planning to buy a house) 5 - max TFSA 6 - RRSP 7 - non-registered
@kovalenkoihor4325 Yes. Through the Canada Education Savings Grant (CESG), beneficiaries receive 20% match to contributions, up to $500 per year. If you contribute $2500, the government will contribute $500, 20% match. The max lifetime limit is $7200 from the government. There is also a carry forward element to catch up from previous years.
I would argue that 4 is always before 6, even if you don't want to buy a house. If you don't buy, the FHSA money is transferred into your RRSP anyways.
I'm glad I opened your video. I discovered the FHSA today but was not going to open an account until you mentioned the ability to carry forward unused contributions would not be eligible until an account is opened. Thanks!
You should include the RDSP to make your content more accessible. I did a look and you haven't even done 1 video on the RDSP account, which is a community that probably needs the most help in figuring out all of these things. Just an idea!
Amazing video, however I did have a thought on the first scenario: In addition to the perks from the FHSA when buying a first home, you can also use the Home Buyers Plan from your RRSP for a down payment, giving leeway to having around $75,000 (if FSHA is maxed + the 25k from the HBP) at a minimum for a downpayment.
Hi Will, you are on the right track, but you have not seen the updated numbers on HBP. Now you can take out up to $60k from your RRSP (new in 2024) and they have increased the grace period before repayment from 2yrs up to 5yrs. One thing that many people don't talk about with these programs is that you should have your initial deposit outside of your HBP and FHSA as you need an accepted contract to do a withdrawal, but the withdrawal process takes longer than the 24hr period in which you must provide your initial deposit. My recommendation if you are a first time buyer would be the following... 1. If you have employee RRSP match, max that out first 2. Put 80% of your remaining saving toward your FHSA and 20% toward your TFSA 3. Once FHSA is maxed out, 80% toward your RRSP and 20% to your TFSA 4. Once your TFSA hits at least 5% of your estimated purchase price, you can then contribute 100% of your savings in the order above each year when the contribution room resets When you get to the point of starting your search, pull your funds out of your TFSA (not to an online bank) so they are accessible within 24hrs via a wire transfer or bank draft.
How about this scenerio: have 3 children and want them to both enjoy growing up in the house we buy as well as have a good education. RESPs for all three would be maxed at 7500 a year (2500 each) and the FHSA 8000 a year (and let's be honest, more than what you can put into this account will need to be saved to actually buy a house). Time is ticking as the kids aren't getting any younger and are missing contribution time for RESP as they get older but also childhood time in that house but almost 15500+ a year seems difficult to attain. What do you do?
My priorities 1. Max RESP (2500 ) per year for child till 17 years . 2.After RESP is done then max out FHSA 3.TFSA max out 4.if you still have money to invest then go with RRSP PS FHSA Will be converted to RRSP after 15 years anyway even if you don't buy home.
High income earners should always look to lower their taxable income where possible (deductibles, RRSP, FSHA, etc...), you can get into a good cycle of receiving significant returns which leads to optionality with your capital, great video!
Good idea on the Canadian tax bracket video, there is not a lot of talk on taxes on the channel. They have worked with @ParallelWeath for retirement and tax. Based on those brackets I would say over $100k taxable as over that is your biggest jump in federal rate was (most provinces are similar). The RRSP reduces your taxable income hopefully enough to drop you a bracket. I'm at the top end of my bracket and I have a pension adjustment that lowers my contribution room. They get me at both ends every April.
I know that in the RRSP you can get the tax benefits by claiming that you deposited later down the line when you are making a higher income and are thus in a higher tax bracket, does this same option exist with the FHSA?
One condition I would invest in non-registered account over the registered accounts is if I need the fund to be very liquid, meaning I may need to sell my positions at anytime and withdraw the fund immediately regardless of the market performance. Especially in a downtrend or volatile market like right now, I can do that without losing contribution room to my tax free accounts, and capital loss can be carried forward indefinitely to offset future capital gain.
encouraging my son who's going to school to start the FHSA ( already maxed on TFSA ) but only contribute minimal amount. Hopefully then contribute when working and can take advantage of tax refund to basically pay no tax for first few years after Univ
Hi Brandon, I just subscribed to your channel since I am a new investor and is living in Alberta, Canada. I am just wondering if I'm still eligible on opening a FHSA account if I have co-signed to a mortgage loan but haven't bought a house myself yet.
I'm going to live in Canada in 2024. I'm a small stock market investor in Brazil and I'm very interested in investing in the Canadian TSX stock market, however in my research it seems to have a limit for annual investments (TFSA) I would like to know if there is any account that I can have larger allocations and how it works.
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My thoughts on the priority are:
1 - max company RRSP/pension matching (100% return)
2 - max RESP government grant per child (guaranteed 20% return + investment returns)
3 - pay high interest debt ( >8% return)
4 - FHSA (if planning to buy a house)
5 - max TFSA
6 - RRSP
7 - non-registered
What is 20% RESP? Government give 20% on top of what you put every time?
@kovalenkoihor4325 Yes. Through the Canada Education Savings Grant (CESG), beneficiaries receive 20% match to contributions, up to $500 per year. If you contribute $2500, the government will contribute $500, 20% match. The max lifetime limit is $7200 from the government. There is also a carry forward element to catch up from previous years.
I would argue that 4 is always before 6, even if you don't want to buy a house. If you don't buy, the FHSA money is transferred into your RRSP anyways.
TFSA set to increase the limit to 7k for 2024. Still waiting for Harper to come back and increase the limit to 10k
I'm glad I opened your video. I discovered the FHSA today but was not going to open an account until you mentioned the ability to carry forward unused contributions would not be eligible until an account is opened. Thanks!
You should include the RDSP to make your content more accessible. I did a look and you haven't even done 1 video on the RDSP account, which is a community that probably needs the most help in figuring out all of these things.
Just an idea!
Amazing video, however I did have a thought on the first scenario:
In addition to the perks from the FHSA when buying a first home, you can also use the Home Buyers Plan from your RRSP for a down payment, giving leeway to having around $75,000 (if FSHA is maxed + the 25k from the HBP) at a minimum for a downpayment.
Hi Will, you are on the right track, but you have not seen the updated numbers on HBP. Now you can take out up to $60k from your RRSP (new in 2024) and they have increased the grace period before repayment from 2yrs up to 5yrs. One thing that many people don't talk about with these programs is that you should have your initial deposit outside of your HBP and FHSA as you need an accepted contract to do a withdrawal, but the withdrawal process takes longer than the 24hr period in which you must provide your initial deposit. My recommendation if you are a first time buyer would be the following...
1. If you have employee RRSP match, max that out first
2. Put 80% of your remaining saving toward your FHSA and 20% toward your TFSA
3. Once FHSA is maxed out, 80% toward your RRSP and 20% to your TFSA
4. Once your TFSA hits at least 5% of your estimated purchase price, you can then contribute 100% of your savings in the order above each year when the contribution room resets
When you get to the point of starting your search, pull your funds out of your TFSA (not to an online bank) so they are accessible within 24hrs via a wire transfer or bank draft.
We all needed this video
Thank you, Brandon for making this video! Showing different scenarios & the logic behind them was really helpful in sorting my thoughts out
Thank you for making & sharing this video with us, Brandon! Much much needed!!
Solid content Brandon, thanks!
Had the same ranking in my mind but nice to hear someone else go through the exercise. Cheers mate enjoy the weekend
How about this scenerio: have 3 children and want them to both enjoy growing up in the house we buy as well as have a good education. RESPs for all three would be maxed at 7500 a year (2500 each) and the FHSA 8000 a year (and let's be honest, more than what you can put into this account will need to be saved to actually buy a house). Time is ticking as the kids aren't getting any younger and are missing contribution time for RESP as they get older but also childhood time in that house but almost 15500+ a year seems difficult to attain. What do you do?
My priorities
1. Max RESP (2500 ) per year for child till 17 years .
2.After RESP is done then max out FHSA
3.TFSA max out
4.if you still have money to invest then go with RRSP
PS FHSA Will be converted to RRSP after 15 years anyway even if you don't buy home.
High income earners should always look to lower their taxable income where possible (deductibles, RRSP, FSHA, etc...), you can get into a good cycle of receiving significant returns which leads to optionality with your capital, great video!
How high would you consider "high income"? Would love a follow up video on tax brackets and RRSP/FHSA contributions.
Good idea on the Canadian tax bracket video, there is not a lot of talk on taxes on the channel. They have worked with @ParallelWeath for retirement and tax.
Based on those brackets I would say over $100k taxable as over that is your biggest jump in federal rate was (most provinces are similar). The RRSP reduces your taxable income hopefully enough to drop you a bracket. I'm at the top end of my bracket and I have a pension adjustment that lowers my contribution room. They get me at both ends every April.
Would love that
Maxed out FHSA, contribute to TFSA & RRSP simultaneously with more focus on TFSA.
Great point of view and so great to see you
Fantastic content (especially for dummies like me). Just subscribed!
really unsure whether open FHSA since it has 15 years timeframe only I think. It does not always mean earlier is better.
I know that in the RRSP you can get the tax benefits by claiming that you deposited later down the line when you are making a higher income and are thus in a higher tax bracket, does this same option exist with the FHSA?
Really good break down thanks a lot for this Brandon keep up the great work!
One condition I would invest in non-registered account over the registered accounts is if I need the fund to be very liquid, meaning I may need to sell my positions at anytime and withdraw the fund immediately regardless of the market performance. Especially in a downtrend or volatile market like right now, I can do that without losing contribution room to my tax free accounts, and capital loss can be carried forward indefinitely to offset future capital gain.
TFSA contribution room does not disappear.
Thanks for the video Brandon, first time saw it. I am agree of all you said
encouraging my son who's going to school to start the FHSA ( already maxed on TFSA ) but only contribute minimal amount. Hopefully then contribute when working and can take advantage of tax refund to basically pay no tax for first few years after Univ
Another great video my friend. Thank you!
Thanks for educating us
please just confusing,i can have TFSA for 7000 dollars and HFSA for 8000 dollars by year,is that correct?
What do you consider is the threshold for a "high income earner" to justify strategy #3?
Thanks brother!
YES!
What about the Home Buyers Plan with the RRSP? Is that not a thing or not worth it anymore?
It is. You can have and use both FHSA & HBP.
HBP has to be repaid. FHSA doesn’t.
Assuming high interest debt is gone first of course.
thanks for the great video Brandon! its good knowledge to have
If I own a home I assume FHSA is not available to me?
Doesn’t fhsa have a maximum of 40k or something? So it’s not too big of a deal if you don’t start it right away
Thank you Brandon
Should I open FHSA with my bank or on some platform like wealthsimple? Or does it even matter?
Recommendations for when you've maxed out all three (TFSA, FHSA & RRSP)? Asking for a friend!
Non-registered
10:44
Great video
Thanks Brandon 👊🍁
what if you already have a home?
You won’t classify for this program
Painful to watch on Jan 1st - did not know about FHSA clock starts ticking from date of opening the account...
Is mutual funds not good?
How to open TFSA and FSHA?
Hi Brandon, I just subscribed to your channel since I am a new investor and is living in Alberta, Canada. I am just wondering if I'm still eligible on opening a FHSA account if I have co-signed to a mortgage loan but haven't bought a house myself yet.
Thank you!
hello sir, how about the RESP?
Ty sir.
Solid content
Just the sound that is a bit low
What if I own a home but never had a mortgage? Can I have a FHSA?
No.
great video, however the volume is low
I solved this vexing problem by turning the volume up. 😂
what will happen if I invest 32K after 4 years(8k each year) and with GIC's interest & stock profit, it went 45K. can I still invest remaining 8K?
Yes it's contributions only
I'm going to live in Canada in 2024. I'm a small stock market investor in Brazil and I'm very interested in investing in the Canadian TSX stock market, however in my research it seems to have a limit for annual investments (TFSA) I would like to know if there is any account that I can have larger allocations and how it works.
I doubt, if you are new to Canada, the contribution room in register account(s) for you will be small.
Please fix the audio, the content is great but can barely hear you here.
That ding was way too loud
Get off my lawn....
You have good content but your style video feels like it's 2004.
fhsa is such a donkey account. Should've just raised the tfsa limit.
Such an ignorant comment....
hard, since TFSA is Conservative's plan, JT needs something new.
FHSA combines the tax benefits of both the TFSA and RRSP. It's significantly better than simply increasing TFSA contribution room.